Agnico Eagle Signs Deal to Acquire Cayden Resources for $186.8 Million

Canadian mining company Agnico Eagle Mines Limited (TSX:AEM) (NYSE:AEM) has agreed to purchase exploration company Cayden Resources Inc. (TSX-V:CYD) for $186.8 million in a mostly stock deal.

The sale, which was announced on Monday, will include Cayden’s two primary exploration projects - the El Barqueno and the Morelos Sur properties in Mexico - as well as 100 percent of the company’s issued and outstanding common shares.

"This acquisition is consistent with our long-term strategy of acquiring promising, early stage gold projects where we can add value through focused exploration and mine building,” sais Angico Eagle CEO Sean Boyd.

"This strategy has served us well in Mexico, and we believe that the Cayden properties are a very good fit with our existing southern operations and skill sets."

The deal calls for Agnico to pay 0.09 of a share plus one cent in cash for each Cayden share, including issuable shares under outstanding options and warrants.

The El Barqueno project covers roughly 41,000 hectares in the Guachinango gold district in Jalisco State, Mexico and hosts an abundant of epithermal bonanza type gold vein and disseminated stockwork system.

The Morelos Sur site, which covers 13,000 hectares in the Guerrero gold belt in the country’s Guerrero State, consists of three properties: La Magnetita, Tenantla and Las Calles.

"The property has tremendous exploration upside and several prospective zones that we believe can ultimately support heap leach and/or milling operations, which would allow us to build another meaningful business in Mexico," said Tim Haldane, Agnico-Eagle Mines US and Latin America operations senior vice-president.

The acquisition is subject to approval from Cayden security holders, Mexican anti-trust and other regulatory and court approvals. The deal is expected to be completed before the end of the year.

"We are pleased with the value that this transaction delivers to our shareholders and are excited at the prospect of Agnico applying its resources to the advancement of El Barqueño and the results that will surely follow," Cayden Resources CEO and president Ivan Bebek said.

Earlier this year, Agnico partnered with Yamana Gold (TSX:YRI) to acquire Osisko Mining Corp. for $3.9 billion.